GDP in New Zealand Q1 surges on the back of immigration

New Zealand’s gross domestic product (GDP) grew faster than expected in the first quarter of 2016 owing to large migration, which increased spending across sectors in the country.

GDP increased by 0.7 percent in the first quarter compared to the previous quarter and 2.8 percent when compared to the same period in 2015, according to the figures released by Statistics New Zealand on 16 June.

A poll conducted by Reuters saw economists expecting a growth of 0.5 percent over the previous quarter and 2.6 percent year-on-year.

Migration also powered construction works, which rose by 4 percent compared to the last quarter of 2015, registering the sturdiest quarterly growth since March 2014.

High migration numbers caused growth to be recorded in various sectors of the economy.

An economist with BNZ, Doug Steel, said population numbers had a positive effect on many industries, especially the service sector, and in house construction.

According to analysts, GDP growth in the quarter beat the 0.6 percent growth prediction of the Reserve Bank of New Zealand, giving the bank more reason to not to ease interest rates when it is scheduled to meet in August.

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